Friday, November 19, 2010

StatsCan released their annual productivity report today that shows provincial gains in productivity across Canada. 2009 was a tough year across the globe but all things said, Canada managed to stay consistent through the year with slight declines offset by growth.

Five provinces posted growth and among them were PEI, Yukon, Manitoba and BC - with Quebec posting the most growth. Unfortunately, resource based provinces did post a loss.

The good news here is the huge growth we're seeing now in 2010. A quick look at our job postings will show you that all of our provinces are picking up in the last quarter of 2010! When this report is released next year, we all expect higher gains.

Labour productivity of the business sector increased in Prince Edward Island, Quebec, Manitoba and British Columbia as well as Yukon in 2009. At the national level, productivity was unchanged in 2009, after decreasing by 0.8% a year earlier.

The strongest growth in business productivity occurred in Quebec in 2009, where it increased by 2.0%. The largest declines occurred in the resource-based economies of Newfoundland and Labrador, Saskatchewan and Alberta.Labour productivity in the business sector by province and territory, 2009

Both business output and hours worked fell in all provinces and territories except the Yukon.

Nationally, productivity of services-producing businesses increased 1.2%, while that of the goods-producing businesses remained unchanged after three consecutive years of decreases. Real gross domestic product (GDP) fell 9.0% in the goods-producing businesses and 1.0% in the services-producing businesses.

In 2009, businesses adjusted to the economic downturn by sharply reducing hours worked. The weakness in output and in the employment market was confined mostly to the first half of the year.

Average hourly compensation in Canadian businesses rose 3.0% in 2009, same as the previous year. Provincially, Newfoundland and Labrador (+9.4%) had the largest increase in average hourly compensation.Atlantic provinces

Business productivity rose 0.4% in Prince Edward Island; the only province in Atlantic Canada to record an increase. Real GDP of businesses, which fell 1.9%, was accompanied by an even sharper decline of 2.4% in hours worked.Note to readers

This release covers provincial and territorial data on labour productivity and related variables by business-sector industry. It constitutes a revision for 2004 to 2009 of the estimates released on June 4. The revisions bring the data into line with the revised data of the "Provincial and territorial economic accounts," published on November 4.

Labour productivity is a measure of real gross domestic product per hour worked. Productivity gains occur when the production of goods and services grows faster than the volume of work dedicated to their production.

Economic performance, as measured by labour productivity, must be interpreted carefully, as these data reflect changes in other inputs, in particular capital, in addition to the efficiency growth of production processes. As well, growth in labour productivity is often influenced by the degree of diversity in the industrial structure. As a result, labour productivity tends to be more volatile in the smaller provinces.

For the purpose of this analysis, as in the national labour productivity releases, productivity measures cover the business sector. It is important to note that real production is based on value added measured at basic prices, not market prices, which is consistent with the detailed framework by industry.

As well, the service-producing business sector and its component, finance, insurance and real estate, exclude the imputed rent for owner-occupied dwellings, because there are no data on the number of hours that homeowners spend on dwelling maintenance services.

In Nova Scotia, productivity was unchanged for a second consecutive year, as real GDP contracted at the same pace as hours worked. A 1.5% decrease in output was due largely to substantial declines in mining and oil and gas extraction and in manufacturing.

In New Brunswick, business productivity was also unchanged after falling 2.7% in 2008. Construction was the main contributor to a 1.7% decline in real GDP.

In Newfoundland and Labrador, productivity fell 8.7% in 2009, the largest decline among the provinces. Real output was down for the first time since 2004, because of a sharp downturn in oil and metallic mineral extraction. At the same time, hours worked fell by 6.3%, also the largest decrease among the provinces.Hours worked in business sector by province and territory, 2009Central Canada

In Quebec, most industries contributed to the 2.0% productivity increase. Large advances occurred in retail trade, transportation and warehousing, and the information and cultural industries.

Real GDP of Quebec businesses fell 1.8%, the result of substantial declines in forestry and manufacturing, especially transportation equipment. Hours worked declined 3.7%, with cuts in every industry except finance, insurance and real estate. Manufacturing productivity in Quebec was up 0.9%, its seventh consecutive year of growth.

In Ontario, productivity declined 0.3% compared with a 1.8% decline in 2008. Manufacturing, mining, and transportation and warehousing were responsible for almost the entire 2009 decrease. Weakness in the manufacturing sector, especially the motor vehicle and parts industry, again lowered growth in business output.

Manufacturing productivity in Ontario fell 1.2%, a smaller decline than in 2008. Output and hours worked in manufacturing both fell by more than 10%. It was the fifth consecutive decline in hours worked.Western provinces

In Manitoba, business productivity rose 0.9%, after remaining unchanged in 2008. Hours worked fell by 1.9%, more than twice the decline of 0.9% in real GDP. The main contributors to the decline in output were agriculture and manufacturing.

In Saskatchewan, business productivity declined 4.1%, compared with a 3.2% gain in 2008 that led all provinces. Hours worked fell by 2.1% in 2009, while real GDP of businesses declined (-6.0%) for the first time since 2006, primarily because of a steep decline in mining, oil and gas production.

In Alberta, business productivity was down 1.3%, the third consecutive decrease. The main contributors to the productivity decline were construction, manufacturing, wholesale trade, and transportation and warehousing. Real GDP of businesses fell 6.7%, mainly a result of declines in construction and manufacturing. Hours worked in businesses fell 5.5%, with the largest declines in mining and oil and gas extraction and in construction.

After two consecutive annual decreases, business productivity in British Columbia rebounded by 1.2% in 2009. Real GDP of businesses declined by 3.9%, while hours worked fell by 5.2%. The weakness in real GDP was due primarily to manufacturing and forestry. The main contributors to the decrease in hours worked were forestry, mining, construction, manufacturing and wholesale trade.The territories

Business productivity in Yukon rebounded with a 0.6% gain in 2009, as real output grew at a faster pace than hours worked. This followed a 6.0% productivity decline in 2008. The main factors in increases in both real output and hours worked were mining operations and construction work associated with the development of a new mine.

In the Northwest Territories, productivity fell 3.4%, following a sharp 8.8% drop in 2008. Substantially lower output by diamond mines due to weaker global demand was responsible for the decrease. Hours worked declined 12.2%, the largest drop in the country.

In Nunavut, productivity fell 12.7% in 2009. Business output was down sharply with the end of construction at the Meadowbank Gold Mine.